in

Exploring the idea of interoperability between Cardano and Litecoin

How YFI competitor Pickle Finance was exploited for $20m in Ethereum stablecoins


During the latest Litening Series webinar, the heads of the Litecoin Foundation explored the idea of introducing interoperability between Cardano and Litecoin. David Schwartz, the project director of the Litecoin Foundation, said that it was important to generate as much talk about this idea as possible, as having a bridge between Litecoin and Cardano wouldn’t benefit just the two blockchains, but the entire crypto industry.

A strong initiative to make Litecoin the first blockchain Cardano can interact with

Set to introduce native token functionality with Goguen, Cardano has already made great strides in becoming one of the first blockchains in the crypto industry to actively push for cross-chain interoperability. However, a much stronger current pushing in the direction of introducing blockchain bridges seems to be coming from Litecoin.

Due to its relatively stable price and a mostly drama-free development process, Litecoin is often left out of the conversation when talking about breaking boundaries in the industry. But, if the latest push coming from the community’s most influential voices does come true, it will put Litecoin at the forefront of crypto innovation.

The idea of creating a cross-chain bridge between Litecoin and another blockchain isn’t a new one—several independent research teams have implemented such bridges in testnets. However, there wasn’t a unified idea of what these bridges would connect until recently, when the idea of a partnership with Cardano popped up.

According to David Schwartz, the project director at the Litecoin Foundation, the idea of introducing a bridge between Cardano and Litecoin was discussed as early as July, when Charles Hoskinson, the CEO of IOHK, reached out to Charlie Lee, the creator of Litecoin. At the time they contemplated implementing a velvet fork as a way to connect the two blockchains, which both founders seemed to have supported.

After Hoskinson and Lee set up a strong foundation, the rest of the Litecoin community, led by the Litecoin Foundation, could then go on to further develop the idea. Schwartz discussed this process during the Litening Series webinar last week, when he sat down with Jay Milla, the director of marketing at the Litecoin Foundation, and Dionysis Zindros, a blockchain researcher at the University of Athens.

He said that it’s been a month since the Litecoin Foundation began pushing the idea of cross-chain interoperability with Cardano to the Litecoin community. And while the idea is still in its infancy, Schwartz noted that it was important to “generate as much talk about this as possible,” as a community-driven project like this needs significant community participation.

Bridging Litecoin and Cardano with a velvet fork

The fact that the idea about a Cardano-Litecoin partnership is still in its infancy doesn’t mean it isn’t backed by cold hard science. Zindros explained that most, if not all of the technical details about the cross-chain bridge are already there, tried and tested on other systems and ready to be deployed.

He said that Cardano and Litecoin can connect by implementing a velvet fork to Litecoin so that the blockchain can adopt NIPoPoWs. While the concept of NIPoPoWs is a well-known one in the crypto industry, velvet forks are yet to make their way into blockchain mainstream.

According to Zindros, in terms of fork intensity, a velvet fork is much softer and more nuanced than a soft fork. A slight variation in blocks produced by miners, velvet forks are used to introduce new features to a blockchain that doesn’t want to go through a massive change brought on by both hard and soft forks.

Convincing any mining community to adopt a new fork is hard enough, especially if that community is as cooperative and tight-knit as the Litecoin one is. When a hard fork is implemented, it brings a drastic consensus change to the blockchain, where some population of the miners have upgraded and some have not. This means that the two groups essentially run two versions of the protocol, refusing to recognize each other’s blocks.

A velvet fork, he explained, allows miners to adopt a new feature without having the supermajority, or even just the majority of the miners to agree on it. It changes the protocol in a way that allows miners that have upgraded to create blocks that are backward compatible with miners that haven’t upgraded.

That way, the set of valid blocks in the blockchain remains the same as it would have been if the velvet fork wasn’t introduced. The blockchain ends up with a certain number of blocks that have additional information in them from the velvet fork and a certain number of regular blocks. Nonetheless, all of those blocks are adopted and added to the blockchain.

However, it’s not the velvet fork itself that creates the bridge to another blockchain. For two networks to be able to communicate with each other, one of them needs to implement NIPoPoWs.

NIPoPoWs, or Non-Interactive Proofs of Proof-of-Work, are cryptographical structures that are applied to Proof-of-Work blockchains as a way to apply some compression to the blockchain’s consensus layer. They are short, stand-alone strings of information that a blockchain can inspect to verify that an event happened without actually having to connect to the blockchain and download all block headers. NIPoPoWs contain only a small sample of block headers—they are, however, enough for the network to verify that a transaction or any other event actually happened.

Schwartz compared NIPoPoWs with a table of content found at the beginning of a book—instead of having to go through the entire book to find a certain piece of information, a reader turns to the table of content to verify that it is, indeed, contained in the book.

When it comes to the concrete velvet fork that would connect Litecoin and Cardano, Zindros said that it would happen on the Litecoin side. He and his team at the University of Athens have already tried implementing a velvet fork on the Bitcoin Cash testnet and had no major technical issues.

If a velvet fork was implemented, there shouldn’t be any problems on Cardano’s side either. Ergo, a Proof-of-Work DeFi blockchain, also implemented a velvet fork to adopt NIPoPoWs that would enable the platform to provide oracle services to Cardano.

Once a NIPoPoW is implemented to Litecoin, it will open up a whole new world of cross-chain interoperability that is much greater in scope than just Cardano. Zindros said that all blockchain platforms that have smart contract functionality will be able to process NIPoPoWs without going through a velvet fork.

On Litcoin’s side, a velvet fork won’t have any noticeable impact on the network’s hashrate. This is because, unlike that of Bitcoin, Litecoin mining works by first hashing the block data and then looking for Proof-of-Work. The impact the velvet fork will have on Litecoin can only be measured in relatively abstract terms such as the network effect, Zindros said.

Cross-chain interoperability means that everyone’s a winner

All of this presents no technical challenge. Zindros said that technically speaking, a velvet fork would be extremely quick to implement to Litecoin.

However, this doesn’t mean that it’ll be smooth sailing.

He noted that the timeline of introducing such a fork to any system is more a political question than a technical one, adding that, with a community the size of Litecoin’s, many people need to agree on how to proceed.

However, both Schwartz and Zindros are extremely optimistic in the long term. Zindros said that the reason why his research team chose Litecoin as the perfect platform to connect to Cardano is the openness of its community. Litecoin’s close-knit community has kept an open mind for years and was quick to adopt ideas and concepts that would have been considered as too forward by many other platforms.

And with a mentality that doesn’t exclude other players and ecosystems in the industry, Litecoin is a perfect pair for Cardano, whose ambitious goals to decentralize global governance weren’t made at the expense of other projects. The easiness with which the Litecoin Foundation can reach out to the community and discuss novel ideas like this one is what makes Schwartz believe that this is a success story waiting to happen.

Cross-chain interoperability is a trend that’s yet to become big in the industry, with Zindros expecting the concept to gain popularity in the next few years. Both Cardano and Litecoin want to become pioneers leading the wave, and both are likely to see a slew of long-standing benefits that are still hard to quantify.

The benefit Cardano will be able to see almost immediately is access to the entire Litecoin user base. Namely, if the platform goes through a velvet fork, all users that use and hold Litecoin will be able to interact with Cardano. All of the capital locked into Litecoin will suddenly become accessible to Cardano—those holding LTC will be able to use it to pay for anything happening on Cardano, and vice-versa.

The value of this effort doesn’t lie in the fact that it will increase one platform’s access to money, despite it being a clear and obvious benefit. Instead, the value of this cross-chain bridge lies in the fact that it drastically improves the value of money stored on both blockchains. And this is something that is set to go far beyond just Litecoin and Cardano—a concept with the potential to move the entire crypto industry.

Like what you see? Subscribe for daily updates.



Source link

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

GIPHY App Key not set. Please check settings

Loading…

0

What do you think?

Blockchain Analytics Firm Looks to Trace Monero (XMR) Transactions

Blockchain Analytics Firm Looks to Trace Monero (XMR) Transactions

Insurance claim success. 282,035 DAI will be redeemable for Cover protocol’s first claim on Pickle hack